Temex Resources Corp V.TME announced April 29 an updated 43-101 resource estimate of its Juby Gold Project located in Ontario’s Timmins-Kirkland Lake mining camp. At a cutoff of 0.4 grams per tonne gold, it contains 25.3 million tonnes grading 1.28 g/t gold for 1.04 million gold ounces indicated and 74.2 million tonnes grading 0.91 g/t for 2.17 million gold ounces inferred.
Compared to the previous Juby estimate of January 2012, the indicated resource increased by 11%, and the inferred resource increased by 140%.
President/CEO Ian Campbell spoke to Kevin Michael Grace April 29.
RW: You showed a significant increase in resources at Juby.
IC: We were able to put a large increase in the inferred category of NI 43-101 resources. We’re pretty pleased about that. We’ve drilled 25 holes and covered a distance on surface of a little over a kilometre. All the holes hit gold, and the mineralized zone we’re identifying keeps on going. In fact, it gets a bit wider in some of the areas we recently drilled, so it’s becoming a substantial gold system.
RW: What are your 2013 drilling plans for Juby?
IC: Actually, the next phase is a field program. We completed a large land consolidation at the end of November last year where our wholly-owned landholding increased by 1,000%. The next phase is to put the geological team out there and assess the ground we have. Then we’re going to do some more drilling in the fall.
RW: How much cash do you have? What is your burn rate?
IC: We have about $7 million hard dollars in cash. Corporately, we burn about $1.2 million per annum. The burn rate really depends on how many drills we have going.
RW: So you’re set for cash this year?
IC: Yes. We raised $9 million in October; so we’re in good shape.
RW: Is Whitney your premiere project?
IC: Whitney is a different kind of project. It’s a working joint venture with Goldcorp IncT.G; we own 60%, and they own 40%. It’s different because it has produced over a million ounces in the past and is in the centre of the Timmins camp, which is Canada’s largest gold camp.
One of the mines on our Whitney property had the highest grade. Whenever you have grade and, in particular, location, that’s a great combination because when you find enough gold to go into production you generally have a shorter timeframe. The other advantage is lower capital costs. You don’t have to build a lot of infrastructure. There is mill access in the area, so you don’t have to build one, and there are roads to the mills.
So is Whitney our premiere project? Whitney and Juby are both good projects, but at this juncture, I would say Whitney’s going to get the majority of our attention in the next little while.
RW: You told me in June 2012, “Within 2 years, I see us moving into a production scenario.” Is that still true?
IC: Yes, it is. We’re evaluating the Whitney resource we filed last October, and there are a number of production possibilities: one large openpit, all underground or some combination of the two. Since last June, we’ve added some serious depth on the mining side, with a fulltime project manager in Timmins who has worked operating mines. Then we added René Marion, the former president and CEO of AuRico Gold Inc T.AUQ, to our board last month. He’s been with Barrick Gold Corp T.ABX and has good minebuilding experience.
Juby is the exploration project, with, in our mind, a five to 10 million ounce potential. The beauty of it is that it is complemented by Whitney, where we’re working toward a near-term production scenario—Ian Campbell
RW: So you see both Juby and Whitney as projects Temex would bring to production and not attempt to sell?
IC: We will take these projects as far as we can. We have the expertise and capability to do that.
RW: Was your company affected by the April 1 changes in the Ontario Mining Act?
IC: Anybody operating in Ontario is affected by those changes. There is some impact, but we’re willing and certainly happy to work through this process.
RW: So you wouldn’t say it’s been a major complicating factor.
IC: With any change there is a timeframe for people to get used to it. We’re used to that in the mining business.
RW: Has your company been affected by the recent price in the fall of gold?
IC: Everybody’s stock price went down. Companies looking to finance have been affected because now they’re looking at doing so at a much lower level, which obviously would mean increased dilution. From our perspective, the factors that raised the gold price to where it was haven’t changed dramatically.
RW: Since the recent low of two weeks ago, the price of gold is up 11%. Do you find this a hopeful development? Do you think that increase will continue?
IC: I was in Zurich when [the gold crash] was happening and was able to listen to a lot of fund managers. Their comments reflected what I just said. For the price of gold to drop that dramatically in a two-day period… The word out there is that 500 tonnes of paper gold were sold in one day. Compare that to the seven years it’s going to take Germany to repatriate the same amount of physical gold. So there is a bit of a disconnect there. My view is that gold is a hedge, has always been one, and I don’t think that’s changed.
RW: We heard a lot of talk about a bottom in junior-mining stocks last year, and then there was another global decline. Do you think we’ve reached the bottom now?
IC: If not, we’re very close.
RW: To sum up?
IC: We’re very optimistic about what Temex is doing. We’re in the right location in northeast Ontario, and we’ve got two different kinds of projects. Juby is the exploration project, with, in our mind, a five to 10 million ounce potential. The beauty of it is that it is complemented by Whitney, where we’re working toward a near-term production scenario. I think this is what separates Temex from so many of our peers.
At press time, Temex had 160.4 million shares trading at $0.17 for a market cap of $27.3 million.